Partnerships are prominent for the substantial growth in the corporate ecosystem. Now for a general audience, it is normal to be uncertain about how to delve into a strategic partnership authoritatively. Most of the aspiring entrepreneurs find themselves in a place where they do not understand how to execute it effectively. Along with certain guidelines, there is a prolific method that fulfils the commencement of partnerships which is the MoU.
What exactly MoU mean?
Memorandum of Understanding is a kind of an agreement between two parties in favour of proceeding further in a concatenated manner.
MOUs communicate the terms held up in consensus by all of the parties involved in a negotiation. However, it does not cover up all the aspects of legalization. It saves a lot of time as far as negotiation and drafting are concerned. A mutual understanding is prioritized at first followed by the roles and responsibilities handled by parties involved.
Why do you need to go for an MoU if you’re up for a partnership?
Even if you have a decent amount of trust factor among the parties involved with you, there is still a chance of difference of interests occurring in the period of partnership. The lack of recognition about the involved parties’ expectations can also hinder the long term growth of the business in the future. This agreement will take regards to the terms of everyone involved while memorializing the agreement in writing.
What are the requirements for getting an MoU?
- The intent of the memoranda should be examined.
- Every party involved should be incorporated into the process.
- The time should be precisely mentioned.
- The detailed description of the equal share of roles and responsibilities among the parties should be introduced.
- Disclaimers, financial arrangements, risk-sharing and signatures are also the major necessities in the MoU.
Getting MoU done in the initial stage can help the parties with the expectations that are declared which puts cessation to the ulterior motives. By hiring a lawyer this can be executed by the agreement of each party involved.